Penn State should overhaul its governing structure in the wake of the Jerry Sandusky child molestation scandal, with the most important step being removal of the university president as a voting trustee, Pennsylvania's auditor general said Wednesday.
Auditor General Jack Wagner had called in July for that and some of the other recommended changes, but the new report elaborates on them and extends into new areas, including board term limits, the granting of emeritus status and the ability of university employees to become trustees.
He said the suggested changes might not have prevented what occurred when Sandusky, a former assistant football coach, used his affiliation with the university to sexually abuse children. There are pending criminal allegations that high-ranking university officials helped cover up complaints about Sandusky.
“Real and substantive reform of the governance structure is still presently not occurring,” Wagner said at a Capitol news conference. “It's time for the General Assembly, the governor and the Board of Trustees to step up.”
He argued that the 32-member board is too large and the Right-to-Know Law should fully extend to Penn State and the three other “state-related” schools: Lincoln, Pitt and Temple. The state Public Official and Ethics Act also should apply to Penn State, the report said.
He said some of the rules that direct how Penn State operates -- including having the governor vote on board matters -- date to an 1855 law that helped establish it.
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“It probably made sense back then, but doesn't today,” Wagner said.
He would shrink the board from 32 members to 21 plus a nonvoting governor, and increase the number needed for a voting quorum from 13 to a majority of members.
University spokesman Dave La Torre said the report would be reviewed and offered the same response when asked about the recommendations that have been on the table since Wagner made them this summer.
Michael Poliakoff, vice president of policy at the American Council of Trustees and Alumni, endorsed Wagner's recommendations and said in particular that Penn State has given too much power to its president.
“This culture of board deference must change at Penn State, and other colleges and universities need carefully to review their governance structure to ensure that boards are empowered and proactive,” Poliakoff said.
Wagner's new report said a revolving door between trustees and high-level university jobs created “a cast of influential insiders with the potential to impair objective and independent thinking.” He recommended restricting such movements.
The report noted that former board chairman Steve Garban had been a Penn State employee for 33 years, including more than a decade as a senior vice president, and that Cynthia Baldwin, a former trustee, later became the school's chief counsel.
Wagner said Penn State should prohibit any movement in which a conflict of interest might arise and provide a five-year period between a job and a seat on the board, or the other way around.
“But strictly following those restrictions and stopping there is not enough,” the report said. “The board is duty-bound to go further by examining and questioning every crossover before allowing it.”
Wagner's investigators found shortcomings in a spot check of the publicly available minutes of trustees meetings, saying they did not fully reflect what occurred and did not include the names of trustees who introduced motions or how individuals voted. The report recommended making agendas available to the public at least five days ahead of meetings.
The board's term limits also should be changed to nine years, Wagner said. The current limits are 15 years for current members, with exceptions, and 12 years for trustees who join the board after July 2013, also with exceptions. Term limit language in bylaws should be expressed more clearly, the report said.
Wagner recommended the board consider ending the practice of granting emeritus status to its own members, and to examine the costs of the current practice.
